Few people in the Western world expected that Iran would give a categorical yes or no answer Tuesday to the Western incentives dangled before Teheran to suspend their uranium enrichment. And, as a result, few were disappointed.

Indeed, Iran's offer of a "new formula" and willingness to enter "serious negotiations" to resolve the dispute fits well into the pattern of Iranian foot-dragging the world has become so accustomed to on this issue over the years.

This tactic can be summed up like this: tease the West by professing a willingness to "engage," leave them with a glimmer of hope that this engagement is actually making some progress, and in the meantime keep plodding ahead with the research and development needed to build the Jihad Bomb.

UN Security Council Resolution 1696 - which was passed, by the way, on July 31 while the war in Lebanon still raged - calls for Iran to suspend its uranium enrichment by August 31 or else face economic and diplomatic sanctions.

Teheran did not say Tuesday either way whether it would suspend its enrichment program. Rather it presented yet another option, buying more time. Never mind that Iran's supreme leader, Ayatollah Ali Khamenei, said on Monday that his country's nuclear program would continue. The Iranians have, once again, tempted the West with the option of more negotiations.

This very temptation has worked wonders for the Iranians. Holding out the possibility of negotiations effectively neutralizes the Europeans, who love the idea of dialogue and engagement and hope that it will lead to solving the problem peacefully and reasonably, and it also makes it difficult for Russia and China to go along with sanctions in the United Nations Security Council, because they will argue that the diplomatic channel was not exhausted.

Just look at what has happened over the last year. Iran has been enriching uranium for months, but - with the exception of the passage of Security Council Resolution 1696 - have paid no price for it.

This tactic also drives a wedge between the US and Europe. The US wants sanctions, and the sooner the better. "There must be consequences if people thumb their nose at the United Nations Security Council, and we will work with people in the Security Council to achieve that objective," US President George W. Bush said Monday.

But while the Europeans, perhaps because they have a lot more economically at stake than the US in Iran, have said they would support sanctions, they don't really seem to want them and may jump at an opportunity to avoid them.

There are reports reaching Jerusalem of renewed contacts between the Iranians and the Europeans in recent weeks, and Israel was aghast at comments made recently by French Foreign Minister Philippe Douste-Blazy's that Iran could play a stabilizing role in the region.

Another major question, and a new component to the whole Iranian nuclear issue, is whether the war in Lebanon has emboldened the Iranians.

The Washington Post reported Tuesday that some of Washington's closes allies believe the effort to curb Iran was made more difficult by the fighting against Hizbullah.

"The Iranians are extremely confident following the outcome of the Israel conflict," the paper quoted a senior European official as saying. "Their Syria-Iran-Hizbullah axis has gone from minority player to lionized hero of the Arab street."

The concern is that a super-confident Iran may now be more willing to spit in the face of the international community.

But despite all the victorious Hizbullah and Iranian rhetoric, it is not clear whether the Iranians actually believe it themselves. Whatever is said about the war, Hizbullah - which was Iran's "aircraft carrier," it's way of projecting power -- has suffered a mighty blow, and, at least for the time being, has had its wings clipped

Sources in Jerusalem say that the Iranians are carefully watching to see how the international community implements UN Security Council resolution 1701 on Lebanon, to gage whether or not it would have the gumption to implement an anti-Iranian resolution as well.

These sources say that it is not yet clear whether the war has emboldened Iran, and painted two possible scenarios.

The first is that numerous countries in the world, seeing exactly how Iran projects its power in world, may shy away from confronting Teheran over the nuclear issue for fear that if they do take on Iran, this type of projection - the Hizbullah model - may pay a visit to their own neighborhood.

And the second scenario is that the world does indeed realize how Iran projects its power, and now understands that this type of power projection would be many times worse were Iran to be backed up by the Bomb.

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